Retirement – Harder for Mom than Dad?
So, I have thought some about retirement. Not as much as I should at my age (27), but it has crossed my mind. I have considered starting some sort of retirement account so I can have a little nest egg when I finally decide to retire. But I didn’t think about how unique my situation may end up being. A single woman isn’t going to make a ton of money; I don’t have a spouse’s income to supplement my own. And then when I hit retirement, I’m still going to be on my own. I’d say I’d worry about that when I got that far in life, but that’s a bad idea. You have to start thinking early.
I saw this article on MSN Money today when I was looking through my usual news feed. And it got me thinking, because I lost my mom and my stepdad may end up having to deal with some of this stuff when he finally hits retirement age. Basically, it talks about how wives have to do their research when hitting retirement and have to figure out what’s best for them, because they are going to struggle when they hit retirement age due to the fact that they make less to start with.
Before you start getting upset and saying that I’m a feminist (I’m really not), look at the data. Women make a good deal less than men do for the same position at the same level. On average, women make around 80 to 85 percent of what men make. This is on average, it may not happen in every company and on every level. But that discrepancy also means that women are paying less into social security in the first place. If you’re paying less into social security and have less of an income to base it on, then you aren’t going to get a ton of social security come retirement.
Thankfully, there’s a couple things that can help. Spousal benefits allow the spouse that earned less to claim 50% of their spouse’s benefits instead of 100% of your own. Even if that spouse doesn’t retire yet, you can claim it at age 62 if that spouse “files and suspends”. If you’re divorced, you can claim that same 50% if you were married at least 10 years and are still not married. The ex doesn’t even need to do anything, that’s all on you. If you are a widow or widower, you can claim 100% of your deceased spouse’s benefits as long as you were married at least 9 months before they passed away or, if it was an ex, you were married at least 10 years.
What do you think? What can be done to help the apparent discrepancy between retirement for women and men? Spousal benefits seem like a good thing to bridge the gap, but are there other things that wives should be doing in order to guarantee a comfortable environment? Share your thoughts in the comments, have a great day, and we’ll see you back here on Thursday. Until then, spend smart, save smart!